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FTX Owes $3.1bn to 50 Biggest Creditors

FTX
FTX

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A court filing has revealed that the FTX exchange owes 50 of its largest creditors nearly $3.1 billion. FTX, once one of the largest cryptocurrency exchanges, filed for Chapter 11 bankruptcy in the US.

FTX owes $3.1 billion to its 50 largest creditors

FTX claims it owes around $1.45 billion to its top ten largest creditors. However, the exchange has not provided the names of any of these creditors. The collapse of the FTX exchange has had a notable effect on the global cryptocurrency market, resulting in a plunge in cryptocurrency prices.

Following the bankruptcy filing, the former CEO of FTX, Sam Bankman-Fried, was forced to step down. John J. Ray took over as the new CEO and is currently tasked with leading the firm through bankruptcy and aiding in any restructuring plans.

The bankruptcy filing of these exchanges shows that the company could be owing money to over one million people and businesses. On Saturday, the company said it was conducting a global assessment of its assets and would restructure some of its businesses.

A court hearing in the US for the bankruptcy case of FTX is set to be heard on Tuesday. It is still unclear how the people who held funds on the exchange before the bankruptcy was filed will be reimbursed. However, experts have warned that the amount could be a tiny fraction of what they had invested with the exchange.

The new CEO of FTX, John J. Ray, has criticized how the company’s former executives handled operations. In a statement, he said that he had never “seen such a complete failure of corporate controls.” He also added that FTX did not have any trustworthy financial information.

Bankman-Fried recently held an interview with Vox, expressing his regret about how the exchange handled customer funds. He also added that he regretted filing for bankruptcy, adding that if he were still in charge, he would have looked for ways to reimburse customer funds.

Bankman-Fried also expressed his dislike for regulators. This is contrary to what the former FTX CEO promoted in the past. Bankman-Fried was a major champion of regulations in the cryptocurrency sector. At one point, he even appeared before the US Congress to testify about the status of the crypto space.

FTX starts strategic review of global assets

FTX, alongside 101 of the 130 affiliated companies, has announced starting a strategic review of their global assets. This review is an attempt to maximize the recoverable value of the stakeholders.

The debtors of the FTX exchange have also announced they were in discussion with Perella Weinberg Partners, a financial services firm. However, the FTX exchange has warned these debtors that engaging this firm would be subject to approval by the court.

John J. Ray has also said that the affiliates of FTX had solvent balance sheets. Therefore, these businesses could be sold or restructured to reduce losses.

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